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Gloria O. Pasadilla, PhDResearch Fellow
ADB Institute
Philippine experience of firm survey of NTMs
Philippine experience of firm survey of NTMs
October 25-26, 2010Vientiane, Laos
Outline
Background info on the project and NTMs
Survey instruments, NTM classification
Results for the Philippines Experience of exporters Collected info on RP NTMs
Notes of experience in data collection
NTM survey project: an attempt to understand trade difficulties from the point of view of firms
Global liberalization process was like ‘“draining a swamp” with the “lower water level revealing all the snags and stumps of non-tariff barriers that still have to be cleared away”.’ (Baldwin)
Best source: firms themselves
NTMs : measures other than tariff; usually ‘Within border’ measures; most common are regulations and standards that affect trade
Not all NTMs are NTBs difficult to determine when a measure is a trade barrier But whether it is an NTM or NTB, the measure increases
trade costs =>similar effect on trade as tariffs: higher price, lower trade volume
Tentative effort to differentiate ntm and ntb using survey (more of this later)
Problem of definition
Important to understand the typology of NTMs based on UNCTAD’s classification (see next slides)
How to proceed with survey
Classification of NTM
A000SANITARY AND PHYTOSANITARY B000TECHNICAL BARRIERS TO TRADE C000OTHER TECHNICAL MEASURES D000 PRICE CONTROL MEASURES E000QUANTITY CONTROL MEASURES F000PARA-TARIFF MEASURES G000 FINANCE MEASURES H000 ANTI-COMPETITIVE
MEASURES I000 EXPORT RELATED MEASURES J000 TRADE-RELATED INVESTMENT
A000 SANITARY AND PHYTOSANITARY MEASURESB000 TECHNICAL BARRIERS TO TRADE
C000 OTHER TECHNICAL MEASURESD000 PRICE CONTROL MEASURESE000 QUANTITY CONTROL MEASURES
F000 PARA-TARIFF MEASURESG000 FINANCE MEASURESH000 ANTI-COMPETITIVE MEASURESI000 EXPORT RELATED MEASURESJ000 TRADE-RELATED INVESTMENT MEASURESK000 DISTRIBUTION RESTRICTIONS*L000 RESTRICTION ON POST-SALES SERVICES*M000 SUBSIDIES*N000 GOVERNMENT PROCUREMENT RESTRICTIONS*O000 INTELLECTUAL PROPERTY*P000 RULES OF ORIGIN*
A100 Voluntary standards, A200 Sanitary and phytosanitary regulations, A300 Conformity assessment related to SPS, and A900 Sanitary and phytosanitary measures, n.e.s.
First and second level of disaggregation
A100 Voluntary standards, A200 Sanitary and phytosanitary regulations, A300 Conformity assessment related to SPS, and A900 Sanitary and phytosanitary measures, n.e.s.
A210 Labelling, Marking and Packaging requirements, A220 Traceability requirements, A230 Tolerance limits for residues and contaminants, or restricted use of certain substances, A240 Regulation of foods or feeds derived from or produced using GMO, A250 Hygienic requirement, A260 Disease prevention measures, A270 Regulations on productions processes, A280 Geographical restrictions, and A290 Sanitary and Phytosanitary regulations n.e.s.
Second and third level of disaggregation
Understanding Procedural Obstacles
A. Arbitrary or inconsistent behaviour:
B. Discriminatory behaviour favouring specific producers or suppliers:
C. Inefficiency or cases of outright obstruction consisting of:
D. Non-transparent practices consisting of:
E. Legal obstacles consisting of:
F. Unusually high fees or charges
Preliminary effort to differentiate NTBs from NTMs through procedural obstacles. Survey contains questions on:
Procedural obstacles: first and second level of disaggregation
A. Arbitrary or inconsistent behaviour:
B. Discriminatory behaviour favouring specific producers or suppliers:
C. Inefficiency or cases of outright obstruction consisting of:
D. Non-transparent practices consisting of:
E. Legal obstacles consisting of:
F. Unusually high fees or charges
C1: Too much documentation or forms to be supplied or completed C2: Too strict, too detailed or redundant testing/certification or labeling requirement C3: Substantial delays in obtaining authorization/approval C4: Complex clearing mechanism such as a need to obtain approval from several entities C5: Short submission deadlines to supply information C6: Outdated procedures such as lack of automation C7: Lack of resources such as understaffing or scarce equipment in destination market
1. Important to understand the typology of NTMs based on UNCTAD’s classification (see next slides)
Smooth-sailing in doing survey rests in internalizing what the classifications and procedural obstacles mean. Training of interviewers ‘group processing’ after a few interviews Learning-by-doing process
How to proceed with survey
Philippines Frame: registered exporters Target export sectors with likely large NTM
experiences Not necessarily reflective of export structure
that is dominated by electronic exports (60%) Two phases: Metro Manila, Regions
(General Santos, Cebu, Davao) Other countries may use different sample
that may be reflective of export structure
Next issue: sample selection
Firms asked about NTM experiences: Specific product Destination market Specific NTM and Procedural obstacles
encountered Unit of observation: firm-product-ntm-
destination Philippines Total: 812 observations out of
303 firms interviewed
How to understand the survey result
Results: Sample Characteristics
Figure II.1. Profile of Interviewed Companies
Manufacturing: 235
Trading: 16Agri: 37
1
123
Sample CharacteristicsSample Characteristics No foreign
ownershipForeign
ownership less/equal 50%
Foreign ownership more
than 50%
Not available TOTAL number of interviewed
companies
No. of companies 254 25 24 0 303
Percent of Total 84 8 8 0 100
Less than 5 years More than 5 years Not available
Nr. of companies 38 264 0
Percent of Total 13 87 0
Foreign vs. Local
Length of Operation
1-9 employees
10-20 employees
21-50 employees
More than 50
employees
TOTAL number of
interviewed companies
No. of companies
25 58 56 164 303
Percent of Total 8 19 19 54 100
Size
Survey of Collected Cases from Exporters
Which NTMs are widely experienced?
Table II.6 Detailed Incidence for SPS and TBTTable II.6 Detailed Incidence for SPS and TBT
Of the SPS and TBT Measures, which is most prevalent?
Table II.8 Detailed Table for A, C and F Procedural Obstacles
Incidence by economic sectors
Which products are most subjected to NTMs?
Result here may be a function of the sample survey, that is, large representation of manufacturing products
Top Countries for which cases have been reported
Table 11.9
Table II.10a:
Top Ten Countries’ Cases by NTM Category
Result implies that developing countries also have large number of SPS or export related measures, etc.
Product incidence, selected countries
Table II.15
Incidence by productIncidence by product
Table II.14: Incidence on Exports per NTM Category
Firms’ perception of sanitary and technical regulations
Firms’ perception of sanitary and technical regulations
Firms’ perception of sanitary and technical regulations
- Familiarity with classification takes time; skill required in asking ‘leading’ questions
- Sample selection: trade structure- More SMEs rather than large companies:
no time and interest- Incentive for companies – more complaints
on domestic regulations rather than destination market because of perception that survey will help change domestic policies
Problems encountered during data collection